The British Foreign Office is today opening a new department to administer all but one of Britain's remaining thirteen Overseas Territories.

The move follows a wide-ranging policy review prompted by the handover to China of Hongkong a year ago.

However, the BBC Diplomatic Correspondent says resolving the most contentious issue -- that of restoring British citizenship to people in the Territories -- has been delayed.

Our correspondent says this is because of differences between the Foreign Office, which favours plans to restore citizenship, and the Home Office , which has been asking whether Britons and other European Union citizens would in turn be allowed to settle in Overseas Territories.

The one territory not to be administered by the new department is Gibraltar, which has a special status as it is part of the EU.